CREDIT RESOLUTION HELP
Foreclosure
A situation in which a homeowner is unable to make principal and, or
interest payments on their mortgage, so the lender, be it a bank
or financial institution, or individual, can seize and sell the property as written in
the terms of the mortgage contract.
What does this mean to me the consumer?
Usually when a home is foreclosed on, a bank will sell it for as much as they can on a wholesale basis. Once they sell the property, any difference owed, which usually includes a lot of fees, and penalty charges will be the responsibility of the consumer. So if you owed $150,000 on your home, and the bank sells it for $100,00. Then the bank will be looking to your for the difference of $50,000, plus another several thousand for the cost of suing you, and paying out for the sale of the property.
Short Sale
If you are close to foreclosure, and or you cannot afford to make payments, you can contact the lender about "short sale" of your property. How this works, is that the bank will list your home as if you are foreclosed, even though you have not. Once the bank accepts an offer on the short sale, they will sell it to that person(s). What ever the difference is, you will pay the lender. This is almost as bad as foreclosure, but is a better option for you to be able to regroup and buy another home in the future.
If you are are in a situation of only being a month behind on your mortgage payment, you can contact the lender and work something out usually. With the way things are in today's market, the banks are use to this a little more than a few years ago.
If possible, get a lawyer, or a financial counselor to help you through this tough time.
What does this mean to me the consumer?
Usually when a home is foreclosed on, a bank will sell it for as much as they can on a wholesale basis. Once they sell the property, any difference owed, which usually includes a lot of fees, and penalty charges will be the responsibility of the consumer. So if you owed $150,000 on your home, and the bank sells it for $100,00. Then the bank will be looking to your for the difference of $50,000, plus another several thousand for the cost of suing you, and paying out for the sale of the property.
Short Sale
If you are close to foreclosure, and or you cannot afford to make payments, you can contact the lender about "short sale" of your property. How this works, is that the bank will list your home as if you are foreclosed, even though you have not. Once the bank accepts an offer on the short sale, they will sell it to that person(s). What ever the difference is, you will pay the lender. This is almost as bad as foreclosure, but is a better option for you to be able to regroup and buy another home in the future.
If you are are in a situation of only being a month behind on your mortgage payment, you can contact the lender and work something out usually. With the way things are in today's market, the banks are use to this a little more than a few years ago.
If possible, get a lawyer, or a financial counselor to help you through this tough time.